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Write-off the cost for a deal that fell through

Posted on: 25th May, 2011 12:26 am
Hi… I've a query. I'm in the profession of buying good properties and then selling them off at a profit after some improvement. Two months back, I found such a property, and made an offer along with earnest money deposit. Apart from that I also paid for the appraisal, inspections etc. However, it's my bad luck that the deal fell through. My query is that can I write-off this earnest money deposit loss, appraisal fee, inspections, etc. associated with the deal? I deal fell through and I don't want to pay anything for that.
Hi Henry,

In my opinion, it will be a better option if you could talk to your tax advisor in this regard. Your tax adviser will take into consideration the fact whether or not the property was a residential home, second home or an investment property. Referring to the Publication 17 from the IRS can also help you in this matter. But it will be better to speak to a tax adviser.

Thanks,

Jerry
Posted on: 25th May, 2011 02:17 am
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